If you are one of those people who claim to not need an estate plan, you are most likely mistaken. Sorry, but it’s true. Take a look at these nine reasons to learn why every adult, regardless of the size of their “estate,” needs a plan.
- You may not always have the ability to manage your own affairs. It is an uncomfortable thought, but many times people become unexpectedly incapacitated, and no one knows who should be in charge of your affairs or what they should do next. With an estate plan in place, you will have made several of these important decisions in advance, such as who will handle your finances and what medical treatment you would have approved.
- Naming guardians for your minor children. Without a plan, the courts will decide who gets custody of your children if something happens to you. Put a plan in place so you can choose who will raise your children if you are unable.
- Naming who will inherit your assets. Did you know that without a will , the Commonwealth of Virginia will actually decide what happens to your assets when you die? It’s true. So, it’s in your best interest to create a plan so that you have a say in who receives your assets and the things that matter to you when you are gone.
- Making sure that children in blended families are treated fairly. If your family is the result of multiple marriages, it is possible that children from different marriages will not be treated as you wish. Sadly, children from first marriages are often left out. But, with an estate plan, you can be sure that your assets are distributed the way you want them to be and that your heirs are treated equally.
- Taking care of your child with special needs. Without a plan in place, your child with disabilities could be disqualified from receiving Medicaid or Supplemental Security Income (SSI) benefits if you leave any amount of money to them when you die. He or she may then be forced to use their inheritance to pay for basic care needs rather than things to improve their quality of life. This can be avoided, and you can have the peace of mind knowing that your child will be taken care of without jeopardizing benefits by utilizing a Special Needs Trust.
- Keeping your assets in your own family. Without a plan, your child’s spouse or even ex-spouse could end up with half of your assets. By setting up your Estate Plan, you can make sure that your assets stay in your own family.
- Ensuring that your family will be financially secure. Will your spouse and children be able to survive without your income? Without a carefully drafted plan and possibly life insurance, your family might not be able to maintain the same living standard.
- Passing on your retirement account. Without a plan, your designated beneficiary for your IRA may not reflect your current wishes, and your beneficiary could suffer a hefty tax consequence. These can be corrected by putting a plan in place for your IRA.
- Continuation of your family business. If you have a family-owned business, an estate plan is essential to the survival of your company. Without a plan in place, you will not have a named successor, and your family may risk losing your business. By setting up a succession plan in advance, you can choose who will own and manage your business once you are gone.
There are actually several more reasons, but the ones above are the “Big 9.” Even if none of the others apply, all of us need to think about reason number one, whether we like it or not. That is why we say that every adult needs an estate plan. If you’d like to get started on yours, give Sheri R. Abrams, Fairfax, Virginia, Estate and Special Needs Planning Attorney a call at 571-328-5795 to schedule a consultation.